A Firm Has Annual Operating Outlays of $1,800,000 and a Cash

question 95

Multiple Choice

A firm has annual operating outlays of $1,800,000 and a cash conversion cycle of 60 days. If thefirm currently pays 12 percent for negotiated financing and reduces its cash conversion cycle to 50days, the annual savings is __________.

• A) $50,000
• B) $6,000
• C) $200,000
• D) $216,000

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Definitions:

Torque

A measure of the force that can cause an object to rotate about an axis, fundamental to the operation of electric motors and mechanical systems.

Rotation

The circular movement of an object around an axis within itself.

Push-to-Test Switch

A type of switch that, when pressed, allows testing of circuits, components, or systems, typically to check functionality or diagnose faults.

Two-Circuit

Refers to a circuit configuration with two distinct paths for electrical current flow, often used for redundant or safety purposes.